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Friday, June 10, 2016

Analyst: Liberal government’s fighter jet replacement process flawed

By Richard Shimooka

Defence Watch Guest Writer

As revealed on Sunday by the Ottawa Citizen, the Liberal Government is considering a sole source interim purchase of Boeing F/A-18E Super Hornets, in order to cover an expected capability gap between the retirement of the CF-18 and the purchase of a next generation fighter. Interestingly this follows on the heels of Canada’s NATO ally Denmark’s release of its evaluation of the options to replace its fleet of 44 F-16MLUs. The Danish government accepted the reports’ recommendations, and is now debating the budget it will put forward for a potential purchase.1 The two approaches are a study in contrasts, which calls into question the process and potential outcome of the Liberal government’s approach.

Denmark’s impetus for re-evaluating its initial decision to purchase the F-35 was similar to Canada history with the project. Their study was launched in March of 2013 amid political concerns over the project’s escalating costs and development challenges. The resulting report is a comprehensive evaluation prepared by military and civilian subject matter experts, combining binding data from manufacturers and government sources.

What makes the Danish process of particular interest for Canada is that the findings were released in a transparent manner. Although a number of nations have selected the F-35 over the past decade, the underlying analysis that lead to such a determination has remained conspicuously absent. This has occurred twice in Canada: the original 2010 DND assessment to select the F-35, and the 2014 National Fighter Procurement Secretariat report. The lack of any comparison analysis has been immensely confusing for the Canadian public, and left it with no ability to judge the features in this debate. This has helped turn opinions against the program, which the Liberal Party sought to exploit in the last election.

The Danish report provides an inconvenient critique of the potential Liberal decision to undertake the procurement of the Super Hornet. First it undermines the contention that the F/A-18E/F represents a low cost option for Canada. The original Liberal announcement to exclude the F-35 a potential competition was largely based on the belief that the Super Hornet or other options could be procured at nearly a third of the overall cost of the F-35. This utilized an erroneous cost analysis that applied out of date data of an aircraft without any key equipment, and left out mandatory fees and charges levied by the US government on foreign procurements. The Danish report clearly shows the F-35 is the lowest cost to both procure and operate, with a total lifecycle cost of only 70% that of the F/A-18E. This was a function of the F-35’s lower production cost, more efficient logistics and training system, and longer airframe lifespan. The F-35’s lower procurement cost was recently highlighted in a statement by the JSF project executive officer, General Bogdan, who emphasized his belief that the F-35s purchase cost drop to between 80~85 million dollars by 2019.2

In sum: Denmark found they required 38 Super Hornets to accomplish the same role as 28 F-35s over the same period, with the former’s fleet costing more to operate and being less capable. Although Boeing has questioned some of the analysis, subsequent clarifications by the Danish government, have made evident the process was done with thoroughness and integrity.3

Perhaps the most comprehensive area of the Danish evaluation was the capability assessment. It involved a broader examination of the international environment, Danish foreign and defence policy and how they related to Royal Danish Air Force’s future operations. A key feature of this section was a detailed analysis of their core allies’ military intentions (including Canada), which emphasized Denmark’s strong commitment to multilateral bodies, specifically the UN and NATO.

These highlighted missions were then further distilled down to six operational scenarios, in which the various fighter options were evaluated. The report found that in all but one category (where all the candidates tied) the F-35 was superior to the Super Hornet and Eurofighter. The latter two options were shown to be deficient in their ability to manage the increasingly complex threat environment of the future. Members of the RCAF’s CF-18 community have become aware of the potential lethality of these threats during their recent operations over Syria and Eastern Europe, where they encountered new Russian air defence systems.

The Danish report does not – obviously – have data that would be helpful to address the primary Canadian government justification for a potential Super Hornet purchase; preventing an apparent gap in capabilities due to the retirement of the CF-18 fleet. Leaving aside questions as to whether such a replacement is imminently required, the potential remedy itself is dubious. It is important to note that an interim buy would commit Canada to either a much reduced fighter force (as Super Hornets will be out of production in the next few years), or a mixed fleet with F-35s. This is a poor outcome, as the 2014 National Fighter Procurement Secretariat report opined; “a mixed fleet would provide less capability at a higher cost.”4

Canada’s approach to the F-35 has no relevant parallel among any other state. Australia’s initial purchase of Super Hornets occurred nine years ago to address the impending retirement of the F-111C, not their 71 F/A-18As (a contemporary Canada’s CF-18s with similar fatigue life issues). Their Hornets will be replaced by F-35s, with the first squadron of planes delivered in 2019 and the fleet declared operational in 2020. Canada could easily follow Australia’s lead and have an orderly transition to a F-35 fleet as fast as they could with the F/A-18E Super Hornet, at a lower cost and greater capability.

The Liberal government has repeatedly stressed that it will avoid playing politics with defence issues. However, the sole source selection of the F/A-18E/F, in any capacity, is simply a blatant form of political interference. While the Conservative government also attempted a sole-source selection of the F-35, they did so upon the recommendation of the military and bureaucracy. It is questionable whether that occurred here, as there is no military, economic or financial benefit for an interim purchase of the Super Hornet over the F-35. The only reason evident for the proposed purchase is to fulfill a questionable political campaign promise that was based on shoddy analysis.

And perhaps this is the greatest disappointment of the Liberal Government’s apparent decision. It entered into power with the promise to be better stewards of the public interest by practicing transparency and evidence based policymaking.5 Denmark has followed this path, resulting in a transparent process that has given credibility to its likely final selection of the F-35. Instead, the Liberal government seems intent in taking the opposite path, disregarding expert analysis and data from Government of Canada sources, as well as foreign reports like the Danish evaluation. It made an evaluation without a proper, credible procurement process, diminishing our international credibility and potentially saddling Canada with an inferior, higher cost aircraft – one that will leave the state and Canadian Armed Forces personnel exposed to greater threats in the future. This should not be allowed to pass.